THOUSANDS of families in the North East face a bleak Christmas after unemployment in the region reached its highest rate for 16 years.
Even before job losses expected at two of the region’s largest employers, joblessness in the North East rose by 12,000 in the three months up to October.
The region’s unemployment rate was 11.7%, the highest in the country, and the worst in the North East since 1995, but are expected to rise with the planned closure of the Alcan plant in Lynemouth, Northumberland, and 4,500 people at Carillion Energy Services – which has bases in Newcastle and Gateshead – told they could lose their jobs.
Nationwide, unemployment reached a 17-year high after another 128,000 joined the jobless ranks, taking the total to 2.64m.
Youth and female unemployment also showed big rises and the number of jobseeker’s allowance claimants increased for the ninth month in a row.
Gateshead MP Ian Mearns said: “I am afraid to say it will get worse. We saw a forecast from the respected Standard Charter bank only earlier this week which is suggestion the UK will fall back into recession next year with the economy shrinking by 1.3%.
“The Government is sucking money out of public services and depressing spending power on the High Street.”
He also said the Government was to blame for putting jobs at Carillion at risk with its sudden decision to slash the subsidy for solar power.
Regional TUC secretary Kevin Rowan said: “The further rise in unemployment in the North East blows another hole in the Government’s claim that the private sector would create more jobs than were lost in the public sector.
“George Osborne’s strategy has been politically motivated and is now exposed as economic fantasy and a failure. The economic pain and hardship experienced by those out of work this Christmas is all too real.”
There were 274,000 public sector jobs in the region between July and September – the latest available figures – down 15,000 from the same time a year ago.
Total employment over the same period fell from 1.168m to 1.116m in the region.
Ross Smith, head of policy at the North East Chamber of Commerce (NECC), said the private sector was taking on more staff, but that was “marginal” compared to job losses in the private sector.
